Real estate crisis, proptech and… legal recovery

Thierry Vignal, founder in 2019 of turnkey investment specialist Masteos, discusses the decline of proptech. In this new episode My real estate podcastan entrepreneur who personified success – Masteos was valued at 150 million in March 2023, adds without limitation.

We had better news to announce on Christmas Day, explains. Unfortunately, the state of the market gives me no other option than to go into recovery with the holding company of the Mastéos group. And we are considering a buyer whose identity we will reveal next month “.

We are facing the worst real estate crisis in fifty years“, explains. With the quadrupling of interest rates since the creation of Masteos in 2019, the proptech model has become unsustainable.

Thierry Vignal reveals, unfiltered, the behind-the-scenes of these young entrepreneurs who raised a lot of money when it flowed freely (50 million euros in equity and 12 million euros in debt for Masteos) and who found themselves abandoned by investment funds in collapse. market…

Selected excerpts from an accessible interview discussing issues that may concern other proptech players in the coming weeks.

About the ravages of the crisis

Rental investment is at a standstill. Sales collapsed. We went from 250 offers signed in June 2022 to 25 vnOctober. Our business has become impossible, it’s like running a restaurant in full captivity. The state of the market gives me no other solution than to go into receivership“.

About the double-edged game of hypergrowth

Masteos was not calibrated to withstand such an adverse economic cycle. In 2019, we decided to play the startup game focused on hypergrowth, not the SME game focused on profitability. Fundraising was to grow as fast as possible, not put money in A’s savings account.

When we spend 50 million, we reach the size of 400 employees and the market overturns our ability to restructure costs, we have no choice but to proceed with the restructuring of the group. Especially since the crisis is pushing venture capital funds to pull back from tech in general, but proptech in particular”

About fundraising

We’ve grown too fast, too soon, even though we’re ultimately a very operational company, and that’s why we don’t fit in very well with this world of technology and venture capital. Fundraising is also sometimes a poisoned gift that makes you lose good financial reflexes. Obsessed with excessive turnover growth, we begin to take in too much without paying much attention to expenses. We are on the brink, we think that the mistakes will be financed from the next fundraising”

About legal enforcement

The enforcement process is an opportunity to reinvent yourself » Masteos has 120 people today. If we get a good buyer to keep most of the team, it could be even better than before“.

We raised 50 million in equity and 12 million in debt. We have 10 million to repay today, we are not able to do it. This is why the company will be placed into receivership on January 2, 2024.“.

Four subsidiaries will be sold for a symbolic euro of court: the transaction subsidiary, the factory subsidiary, the energy renovation subsidiary and the administration subsidiary. They should be sold to the same buyer. »

About venture capital

Venture capital creates zombie boxes that are not cycle resistant at all. This is a funding method that is unfortunately incompatible with proptech… When the market turns, relationships with venture capital funds become strained, management teams find themselves on the sidelines, shareholders take the reins, and that brings real liability issues that many law firms are working on today.

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